New figures from Knight Frank show that price growth in the high end country market moderated in the third quarter of 2021, although a supply shortage is likely to keep the sector buoyant over the winter.
In the three months to September average price growth was 2.1 per cent - the weakest quarterly rate this year. The agency suggests this may be an early sign that the ‘escape to the country’ momentum is peaking.
The quarterly increase pushed the annual rate of growth market to 10.6 per cent in September, which is the highest level since the first quarter of 2007.
“After a remarkable period of activity some of the heat has come out of the country market as we move into autumn. However, the return to normality will likely be a slow process with demand still significantly outstripping supply, a situation that is unlikely to improve significantly until next spring” says Chris Druce, senior research analyst at Knight Frank.
The agency’s country business set new records for the number of exchanges in March 2021 and then, following the extension of the stamp duty holiday, in June this year.
However, the national lockdown at the start of this year delayed supply coming into the spring market, and with heightened activity throughout 2021 demand has continued to outpace supply. The ratio of new prospective buyers (demand) versus new instructions climbed from 11.6 in August to 13 in September.
The ratio is the highest it has been in more than eight years.
With supply tight, some prospective sellers held off as they have been unable to find purchase options for themselves in a frenetic market, which has exacerbated the problem as discretionary sellers at the top choose to wait.
While it took on average 144 days for an offer to be accepted in September 2019, this had come down by more than a third to 91 days in September 2021. The number of viewings held before an offer is accepted was 16.8 in September compared to 21 two years ago.